Thursday, July 23, 2015

i'm going to take a middle position on this. i'll argue that raising the minimum wage doesn't have an effect on jobs, but it's to a point, of course. i think that more to the point is that, somewhere along the way, we have to agree that what we call the "living wage" should not be the minimum wage - but also that there should be more living wage jobs and less minimum wage jobs. i think that we need to apply a needs-based model to get to a fair answer here. market economics aren't capable of really addressing this, as they gloss over too many details and they're approaching the issue from the wrong perspective.

the idea behind calculating the living wage is sound. lots of people have families. they require a certain amount of income to exist. wages in some sense should reflect what they need. i don't argue with this, and i agree that these are calculations that need to be done to create policies that need to be implemented.

however, the truth is that the labour force is full of plenty of people that don't have families. young people. people that are single. i'm from ontario, and we're relatively progressive, but the minimum wage has still always been considerably less than the living wage, as it's calculated here - and that varies from city to city. even so, the truth is that i've never had a problem making ends meet on minimum wage. but, there's lots of factors with that. i don't pay for cable. i don't have kids. i walk, bike or take public transportation; i don't have a car. etc. nor do i want any of these things, nor would increasing my income incentivize me to want any of these things. what the living wage calculation is missing is that i represent a fairly large fraction of the workforce; the truth is that it really doesn't make a lot of sense to pay me a minimum wage that is calculated as the minimum required for a single mother to live in a city with a car, because i'm not a single mother with a car and never will be. that's almost twice what i really need. as a rational agent, i wouldn't turn down the money. but, the truth is that i'm going to spend it on concerts and guitar effects. which is good for the economy and everything. but the point is clear. what i require as a minimum wage is considerably less than what a single mother would require as a living wage.

if you take a look at the workforce, you realize that a large percentage of minimum wage workers are older people with families. this strikes me as more of a root of the problem. there has to be way to find better jobs for these people, that pay living wages - and allow me to continue flying solo rather comfortably on the minimum wage.

so, if this is an issue for federal politics, it reduces to the need for a better jobs strategy, rather than a mandated wage increase. and, if that is deemed impossible, i'm left with the conclusion that there ought to be a legislative framework that determines salaries based on needs - and restricts discrimination on the point with the highest penalties. it's very much in contradiction with liberal market values, but i'm sorry - if i'm working the same job as a mother with two kids, you really ought to be paying her twice as much as you're paying me.

even if that's not something anybody wants to jump at, it's still not really a federal issue, because the living wage is dramatically different across the country. the only way it becomes a federal issue is if the legislation mandates action at a state or even municipal level. and, while my understanding of the united states constitution is weaker than my understanding of the canadan constitution, i'm pretty sure it's unconstitutional for the president to pass a law telling the states to pass a law.

so, i think this needs to be decoupled and approached a lot more subtly. throwing a flat number out there is easy politics, in some sense. i don't think it's good policy.